New York ? If market demand determines prices, perhaps a movie ticket to popular blockbusters like Mission: Impossible should be more expensive
A ticket to see the latest Mission: Impossible sequel and the "little" Charlize Theron movie, Young Adult, costs the same amount, says Derek Thompson at The Atlantic. Yet while customers are flocking to see the former ? M:I has grossed over $140 million in the U.S. ? Young Adult has barely earned over $10 million. This raises the question: "If demand is supposed to set prices, why isn't seeing Young Adult much cheaper than seeing Mission: Impossible?" Considering the recent news that movie attendance hit a 16-year low in 2011, perhaps the film industry could save itself by taking this concept to heart. Would charging different prices for films depending on their budget, likelihood to be a hit, or how long they've been released really work?
Nope: This is too idealistic, says Thompson. If, for example, the prices were cut after a film's opening weekend, people would purposefully wait to see it, slashing a movie's potential profit. Plus, "price can repel as easily as it attracts, because it's a signal of quality." Though Mission: Impossible and Young Adult both received rave reviews, if one was cheaper to see than the other, audiences would "assume it's garbage." And as a business model, theaters would never go for this. It would encourage people to sneak into movies (purchase a cheap ticket to The Iron Lady then slip into Sherlock Holmes) and lead to tense price wars between rival cineplexes.
"Why do all movie tickets cost the same?"
It makes perfect sense: This is an idea I could get behind, says Kelly West at Cinema Blend. There are many times that I've bought a ticket to an indie film and was forced to sit in tiny theaters that feel "more like a screening room." Considering how much larger the screens at cinemas showing blockbusters are, "it does seem like I should be paying less for my ticket." Slashing prices later on in a film's run could actually encourage more people to see it, too. And the debate over whether charging less leads audiences to believe a film is "garbage" doesn't give enough credit to an audience's "decision making abilities."
"Arguing the one-price ticket system: Should all movie tickets cost the same?"
All movie tickets should cost less: There's an easy way to fix the film industry's woes, says Roger Ebert at his blog: Lower ticket prices across the board. From Netflix to On Demand streaming, there's too much competition for the industry to continue charging escalating prices for all its films. Furthermore, one of the few bright spots in 2011's attendance figures was the increased popularity of indie films. Theaters would do well to make them more available to consumers ? whether through more showings or cheaper prices ? since there's clearly a demand to see them. The industry "can't depend forever on blockbusters to bail it out."
"I'll tell you why movie revenue is dropping?"
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